Electric Vehicles Spark Growing Interest

A Renault Samsung Motors Co. SM3 Z.E. electric vehicle sits on display at the first International Electric Vehicle Expo in Seogwipo, Jeju, South Korea, on Sunday, March 16, 2014.

Bloomberg News

JEJU, South Korea–On a fine Monday, Uhm Hyung-gil, 65, passed up a visit to the seashore of the scenic island of Jeju to check out an electric-car exhibition at the International Convention Center here to test drive Renault-Samsung Motors’ compact SM3 Z.E.

“I think it was worth my visit here,” said Mr. Uhm, a businessman who lives in Gujwa County, east of Jeju. “The car is pretty cool. I felt comfortable in it. It was so quiet that I thought the car could hit pedestrians without [their] knowing it’s coming.”

He said he now is considering replacing his 18-year-old gasoline-guzzling sedan with a battery-powered vehicle in the coming months.

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South Korea aims to have all the cars on Jeju be electric by 2030, as the resort island, about half the size of Rhode Island, is within the single-charge range of most battery-powered vehicles. The country, one of the world’s most aggressive in adopting emissions-free policies, has turned to electric cars as concerns grow about the environment and volatile oil prices.

To achieve its goal, the government is offering generous subsidies and tax breaks for electric-vehicle, or EV, buyers, while planning to impose taxes on vehicles with large amounts of carbon emissions starting next year.”Having more electric cars on the road across the country is one of the government’s top priorities,” Vice Minister of Environment Jung Young-man said Monday at the government-organized exhibition.

The show has drawn more than 30,000 visitors since its opening Saturday, said Hur Sujung, an official with the event’s organizer. She said it has been years since an event at the convention center has attracted such a large number of visitors.

The new policy would help increase the number of small cars and fuel-efficient cars and reduce energy consumption in a nation where two thirds of automobiles are mid- to large-sized sized vehicles, the Environment Ministry said. South Korea heavily depends on imports for its energy needs.

A man gets into a Nissan Motor Co. Leaf electric vehicle (EV) for a test drive during the first International Electric Vehicle Expo in Seogwipo, Jeju, South Korea.

Bloomberg News

Attracted by lavish state support, Nissan Motor Co. introduced its best-selling electric car, the Leaf, to South Korea at the exhibition. The Japanese car maker, which has sold more than 100,000 units of the vehicle globally since its launch in 2010, expects to sell the Leaf in Korea from the second half of this year.

“This event is different from any other events that I’ve been to because Jeju is one hundred percent committed to EV by 2030,” said Billy Hayes, vice president of Nissan’s global electric vehicle business. “We’re very fortunate to be able to put the Leaf on Korean consumers’ shopping lists.”

Other global automotive manufacturers, including BMW AG, General Motors Co. and Renault SA, also put their latest battery-powered models on display.

Tesla Motors Inc., the global leader in luxury EV cars such as the Model S sedan, missed the exhibition, citing a tight schedule, while Hyundai Motor Co., Korea’s largest auto maker, skipped the show because its first electric-vehicle wouldn’t be ready until 2016, organizers said.

A woman test drives a Kia Motors Corp. Ray electric vehicle during the first International Electric Vehicle Expo in Seogwipo, Jeju, South Korea, on Sunday, March 16, 2014.

Bloomberg News

On Jeju, drivers can travel along the 180 kilometers of coastal roads. Because electric vehicles, once fully charged, can travel between 100km and 150km and given most people drive less than 100km daily on average, the island is about the right size for the use of EVs, local government officials said.

Jeju provides as much as 23 million won ($21,800) in subsidies for a EV purchase this year. The amount is almost double those in other advanced countries. The U.S. and Japan–the world’s top markets for electric-car sales–offer up to $10,000 and $13,300, respectively.

There are some 300,000 vehicles on the roads in the island, of which 360 are powered by battery. The government said it aims to raise the ratio to 30% by 2020 and turn Jeju into a carbon-free island by 2030, by which time its total number of cars is expected to rise to 370,000.

Across the country, the government hopes to raise the number of all-electric vehicles on its roads to one million by 2020 from fewer than 2,000 now.

Analysts, however, say a lack of charging stations, the absence of a unified charge standard and range concerns are stumbling blocks to broad adoption of electric vehicles in South Korea as well as globally, which can’t be resolved in the short term.

“The switch to zero-emission cars makes a perfect sense, but just don’t expect it to happen quickly,” said Sunwoo Myoung-ho, a Hanyang University professor and the president of the World Electric Vehicle Association. “Nevertheless, EV or ultra-low-emissions vehicles are the future.”

Driven by tighter emissions standards in Europe, world-wide production of electric vehicles is expected to soar 67% to more than 403,000 units this year, according to research firm IHS Automotive.

The huge increase contrasts with the 3.6% rise in global manufacturing of all motor vehicles expected in 2014.